most are instaled to your root rFactor folder, extract to a temp folder and compare structure to your rfactor install lots of help when you check out the Sim Race Essentials Toolbar http://simrace.toolbar.fm
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no mods dont work
You have to go to Setup then go to mods an pick one and press load.
one with mods in it
Yes, you can. Google for Modstallation and use that software to install your mods. Follow the instructions online too.
Yes, as long as you don't use it with any other conflicting mods, or mods that cause the build craft mod to break.